Number of investment and savings companies continues to rise

The number of investment and savings companies has been steadily increasing since 2010, according to a study by the Netherlands Bureau for Economic Policy Analysis (CPB). A possible explanation is that wealthy households are trying to pay less tax this way.

The CPB study shows for the first time the various functions of private limited companies (BVs). Many BVs are businesses, in the sense that they provide services or produce goods using labor and capital. Many BVs are also established for the purposes of saving, investing, building a pension, managing real estate, or managing investments in other businesses. All these types are treated the same for tax purposes.

10 percent
The latter makes it attractive to transfer assets to a private limited company (BV). Of the nearly 1 million BVs in the Netherlands in 2018, almost 10 percent were investment or savings BVs. The continued increase in this number appears to be related to the higher effective tax rate in Box 3, primarily due to the decline in interest rates. This may be a reason for wealthy households to transfer assets to a BV.